Are you a savvy saver?

When it comes to money, most of us fall into one of two camps:

Proactive: Devote time and energy to a financial plan.

Reactive: Only think about moolah when we need it.

If you fall into the latter, then, the time is nigh for change. Here are 3 easy ways to start saving.

Create a Budget

Before you can save, you need to know how much you spend. Luckily, many online banking platforms automatically track and categorize spending so there is nothing extra that you need to do except review the numbers. This review step can provide a real “aha” moment, especially when it comes to understanding how much your daily habits cost. For instance, you might not think twice about buying breakfast every day, but when you see that you’ve spent $600 in one month on avo toast and double espressos, you might decide to curb your ways.

Save for an Emergency

Once you know how much you spend, you need to set aside enough to cover those same expenses for several months in case of emergency. No one likes to think about job loss, death or disability, but these are real-life scenarios that require a plan. And, in the middle of such a crisis, it’s a relief to know that you have some breathing room on the cash front.

Plan for Retirement

Creating a budget and saving for an emergency tells you exactly what you need to fund your current lifestyle. Then the question becomes: What about retirement? Are you willing to go on fewer vacations, eat out less frequently, drive older cars or sell your home? For many of us, the answer is no. We want our quality of life to continue. If this is the case, have you saved (or are you saving) enough to sustain your spending in retirement? How much do you even need to meet this goal?

If you aren’t sure of the answers to these questions, there are one-time financial planners that you can engage who will take all of your financial data and create a plan that will help you answer them. Your current investment advisor may even be able to do this for you, depending on their level of expertise.